Portland soccer jobs not exactly as promised

Micah Escamilla/The OregonianJ.R. Wyman paints the lines in preparation for opening night at PGE Park tonight, when the Portland Beavers play the Fresno Grizzlies. Team owner Merritt Paulson's economic consultant estimates 217 new jobs for baseball and soccer with the renovation of PGE Park for soccer and a new baseball stadium.

Merritt Paulson pledged to create slightly more than 300 jobs by bringing a Major League Soccer team to Portland. With Oregon's unemployment rate among the nation's highest, Paulson's promise makes a compelling argument for taxpayer support.

But Paulson's job pitch isn't as grand as it may seem.

About a third of those jobs aren't his to create. His economic consultant, Economics Research Associates, says Paulson's plan would add 217 jobs within his soccer and baseball teams. Paulson's 300-job pledge includes about 100 jobs that might be added by restaurants, parking lots and garbage haulers who feed off the teams.

Of the jobs Paulson would directly create, about 160, or three-quarters, would be full-time positions paying roughly $50,000 on average with health and retirement benefits, he said. The rest would be low-wage, part-time, seasonal ticket takers, ushers and others who get no benefits.

What's more, independent researchers have repeatedly found that new teams or stadiums provide little to no boost to a city's economic prosperity. Consumers simply move their finite entertainment spending from bowling alleys to stadium beer lines. The effect is a jobs shift from one employer to another.

"The 'it creates jobs' argument is kind of a smokescreen," said Charles A. Santo, a planning professor at the University of Memphis who has studied the topic.

In fact, Paulson's part-time workforce at PGE Park earns such paltry wages that the City Council spends taxpayer money to boost their pay.

Mayor Sam Adams, one of Paulson's chief supporters at City Hall, has rallied against Wal-Mart's expansion in Portland partly because of its low wages. Yet the retailer offers similar wages to what Paulson's part-time workers make -- and better benefits.

What's next

• Next week: The Portland City Council is expected to vote Wednesday on agreements for Merritt Paulson to plan the two stadiums.

Paulson contends Portland and Major League Soccer offer a unique match that academic economists haven't studied. Soccer fans travel more often than basketball fans, he said. He argues that out-of-towners would come see Seattle's team play Portland or watch a European exhibition. Those people, in theory, inject fresh money into the economy.

Adams, though, acknowledges that the jobs created would be modest. "There's an economic benefit to that, but I've not led with that," he said.

Instead, the mayor said he wants to invest taxpayer money in the deal to revive the moribund Rose Quarter, put Portland on an international stage and provide the city with another entertainment choice.

"It raises the visibility of the city," he said. "And it's a family-friendly activity that brings the city together across gaps in income and race and gender."

118 workers got subsidy

Paulson and city leaders continue to negotiate details of the $88.8 million proposal. The money -- most of it coming from taxpayers -- would renovate PGE Park into a soccer-only stadium and build a baseball park where the Memorial Coliseum now stands.

One issue that remains unresolved: How and how much to pay part-time workers at both stadiums. Today at PGE Park, the city subsidizes worker wages under a 2001 agreement that predates Paulson's 2007 purchase of the minor-league soccer and baseball teams.

The council wanted PGE Park workers to earn a living wage. A 2008 study by the Northwest Federation of Community Organizations found a single adult in Oregon must earn at least $12.39 an hour to meet basic needs.

The city pays $150,000 a year to boost stadium worker wages to $11.26 an hour. The payments last year went to 118 ushers, ticket takers and field maintenance workers. (Concession crews work under a subcontract with Paulson's company and don't receive the city subsidy.)

Paulson last year paid most of those workers the state's minimum wage, $7.95 an hour, and the city paid an additional $3.31. Other workers earned $8.50 plus a $2.76 city subsidy, according to city records. None of those workers received health coverage or retirement benefits, Paulson said.

A task force that studied Paulson's proposal told the City Council that stadium workers should continue to earn the city's fair wage. Steve Maser, the task force chairman, said the group simply parroted the "social principles" Adams provided to them as they began their deliberations that read: "The City's Fair Wage policy will apply to employees at PGE Park and the new baseball park."

When asked if he would pay a "fair wage," Paulson said the issue is still under negotiation.

Continue subsidy?

The city started subsidizing PGE Park workers' pay after it renovated the stadium to bring Triple A baseball back to town. Under that deal, the stadium's management moved from government to private hands. That move dissolved a union that had negotiated worker wages.

At the time, Commissioner Dan Saltzman and then-Commissioner Erik Sten said they wished they had required the private stadium operator, Portland Family Entertainment, to pay higher wages rather than tap taxpayers for a subsidy.

Today's City Council is undecided about the issue.

Sten is gone, but Saltzman, who cast the deciding vote to back the recent stadium deal, still thinks workers should earn a living wage and that, preferably, Paulson pay it. "But I won't rule out the city picking it up because there are a lot of things still being negotiated," he said.

Commissioner Nick Fish is a firm no: "I don't think the city should be subsidizing wages in the private sector." So is Commissioner Randy Leonard, who said he has reversed his position from his previous vote.

During talks with Paulson, Leonard, a former firefighters union boss, concluded that the city's subsidy hurts stadium workers' chance to organize.

"One of the fundamental tenets of the labor movement is that workers should be able to determine their own value," Leonard said. "We were being rather paternalistic without asking the workers what they wanted."

Leonard said the city should require Paulson to allow the workers to organize without interference, much like the city does today.

Adams, who has campaigned for higher worker wages since he joined the City Council, remains undecided.

In 2007, Adams pushed Global Spectrum, which used to manage the Rose Garden, where the Trail Blazers play, to drop its janitorial contractor over concerns about low wages and unaffordable benefits.

"Global Spectrum is part of this huge business empire," Adams told The Oregonian in 2007. "Last time I checked, they were very profitable. They have the money. They just don't have the moral backbone to do it."

Adams said that as a city commissioner he fought Wal-Mart's expansion because of low wages and because the retailer resists worker attempts to organize.

Wal-Mart's entry-level workers, full time or part time, typically earn $7 to $9 an hour, said Eric Bull, spokesman for the union-backed group Wal-Mart Watch. The company says it contributes to workers 401(k) and that 52 percent of its workforce had company health care as of November.

Adams' and Leonard's positions worry Joe Rastatter, a labor leader with the Portland office of Jobs with Justice and a former ballpark vendor. It could take years for stadium workers to organize because many of them work only 10 to 20 hours a week for extra money, he said.

"I don't think Randy (Leonard) wants to say that poverty wages are an acceptable part of the deal that Merritt gets," Rastatter said.

Economic boost debated

Sports teams and stadiums on their own don't create jobs, researchers have concluded.

Asked for counterpoints, Paulson and his consultant, Don Mazziotti, pointed to several studies that included one by Santo, the professor who studied Portland's bid for a pro baseball team.

Santo's work cites eight "empirical studies" that established "conventional economic indicators cannot justify public investment in sports facilities. The evidence shows that stadiums and arenas have no significant impact on metropolitan area income or employment."

Yet, cities keep subsidizing sports stadiums.

Santo's study shows that is partly because politicians know that sports teams generate intangible public benefits. People like sports and the teams can boost civic pride and provide "big-league city" cachet, an argument Adams supports.

Santo said there's evidence that new parks can channel economic activity into a depressed neighborhood. That's what Adams said a baseball stadium will do in the Rose Quarter.

Fish, who opposed the Paulson deal, also remains a skeptic.

"We know the return on investment when we put money into schools and housing," he said. "There's no evidence that investing in soccer is an economic development play."

Despite the academic research, Paulson and other team owners continue to push the economic benefits of publicly financed stadiums. That may be because the message connects with taxpayers. In a 2004 survey, Santo found 70 percent of Portland-area residents thought a new pro baseball stadium would help the economy.